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The gain was 10.9% higher than the year ago comparison and was the 16th consecutive month of year-over-year gains.

The number of homes for sale declined steeply and prices are beginning to rise in more markets.

Based on the sales pace in October, there are only 5.4 months of housing supply available.

That’s the lowest since February of 2006, just before housing began its long decline.

Demand among traditional buyers has increased substantially as interest rates have remained low, making homes more affordable than at any other time over the last 15 years.

The Mortgage Bankers Association said that applications for loans rose 22% in the first week in November from one year earlier.

November numbers could drop because of Superstorm Sandy. Another caveat may be whether Congress reaches a deal to avoid the looming fiscal cliff. Mortgage lending standards are still quite stringent, which may add to the mix to constrain sales.

The psychological perspective of the fiscal cliff may also inhibit sales because people may become more reticent to invest in housing as a result.

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